The rise in delta variant Covid cases, especially among unvaccinated people, is starting to take a new toll on the already-battered airline industry, just when it was seeing daylight and profits again.
Southwest Airlines, the largest U.S. domestic-flight carrier, says it “has recently experienced a deceleration in close-in booking,” meaning that fewer people than expected are buying tickets for flights in the near future. It also reported that it is seeing “an increase in close-in trip cancellations in August 2021.”
The airline is now predicting significantly lower earnings than it told Wall Street analysts three weeks ago. And that outlook is likely to continue for a while; travelers with late-summer vacation plans are backing off, and businesses that planned to go back to offices in September are starting to post postponements.
Another effect that’s showing up is more flexibility by airlines; last year all the major carriers eliminated change fees permanently, except for basic economy which saw only a temporary waiver.
Delta last month restored that waiver, which ended April 30, and United has now reinstated its waiver, retroactive to April 30. Both airlines have said the waiver will end for tickets purchased after December 31, although it could be extended. No word yet from American on whether it, too, will restore the waiver, or from the second-tier airlines. Southwest is not affected because it has never had change fees.
